Don't Trip Yourself up While Buying a New Home
What's more fun than getting a bunch of new stuff to adorn your future home? Nothing. But making big purchases before your loan closes could be trouble. Keep in mind that until closing, your lender is watching you very closely. We have given you a list of actions below we suggest you avoid when waiting for your loan to close.
Don't throw your money around. You may be itching to turn your new kitchen into a showplace, or celebrate your new dream home, but stay away from expensive purchases like furniture, jewelry, appliances, or vacations until the loan closes. Your credit numbers could be altered suddenly if you purchase new furniture using credit cards. Since lending institutions are reviewing your financial accounts, a large cash purchase is also a bad idea.
Don't look for a new career. Lenders look for a consistent job history on your paperwork. Getting a new job may not jeopardize your ability to qualify for a mortgage loan - especially if you are improving your salary. However, switching jobs during the approval process may influence whether or not you are approved.
Don't change banks or move finances around in your bank accounts. Bank statements from the last few months for all of your accounts (checking, savings, money market, and other accounts) will probably be analyzed as the lending institution considers your application. To detect potential fraud, most lending institutions need a detailed paper trail to determine the source of all cash. Changing banks or transferring funds to another account - for whatever purpose - may make it harder for your lender to document your funds.
Don't hand over a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. Until the completion of the deal, any good faith money actually belongs to you. Although your seller might not understand this, your good faith funds must go toward the buyer's closing expenses. An attorney or other type of neutral party can hold onto your deposit, or you may put it temporarily into a trust account until closing. Your contract should specify to whom the money goes if the home purchase fails.
Amity Mortgage LLC can answer questions about these "Don'ts" and many others. Give us a call: 2037296681.